The Market Perspective

Three in a Row

Tuesday Feb 29, 2012

The market continues to ignore the reliable indicators that are flashing caution. The summation index falls,the Transports fall with higher oil prices suggesting Dow Theory problems, insiders are selling as fast as they can, these are all realiable signals, but the market frustrates as stocks and gold push higher. 

Well, the market did the same thing in February March of 2010 and 2011, it rallied in good fashion, finally pulled back in March, and then made new seasonal highs around tax time. Let's look.

 

See the pattern?  Seasonally markets make fall lows. They did that in 2009 nad 2010. Then the initial rally extended along th green line into the early part of the next year.  The pullbacks ended at the blue arrows we show. The markets then snapped back to new highs in another impressive rally. 

NOte that each year the maarkets sell off more and thne rally move, volatility increases. The message is that is setting us up for an even larger point sell off even if it is the same percentage as last year. But that should be later. So, for now, here is the best road map I can furnish.  Let me be clear, if the patterns of the last two years repeat, the market has a short term top, well shortly, a pull back, and then races to a higher high for the year. 

Regrettably stockcharts and other services still lack the 'fast forward' feature we really need....

 

Like Wiley Coyote, the market is running over the cliff without the internal underpinnings to suport it but price is price. We can expect Wiley to fall to a supporting ledge, then scramble up and the chase should be on again. 

Now they Want us to Buy Gold?

Tuesday Feb 28, 2012

I see recomendations here and there  to buy gold now. The bullish percent is moving up. Our analysis was correct to 

buy gold and silver in December

buy RIG

But we exited too soon. I thought RIG was good for 60 if not its book value of 65. That appears to be correct. So is it time to jump back in?  Before we do this is all dependent on the Dollar. Let's take a look.

US Dollar

This chart adds the FIB retracement tool. So the Dollar has retraced 61.8% or so of the advance since the October low. It has falen right to the 200 day MA, 21.77. For some reason the java tool truncated the entire chart but you can see the action today at far right. 

Now let's suppose the Dollar, UUP,  does NOT find support at the 200 day MA. The last time it sunk to 21.1. But, it only spent  six days below the 200 day MA before it was right back where it started and then rallied. So  based on the October experience,there is  reason to think support is within six days time if not at this price. The market has not exactly run away from us but it has moved up in areas we were long. 

I am tempted to try RIG again, it is just too cheap below its book value. 

CNBC Color Graphic

Now another thought. No doubt CNBC is on in many formal and informal offices of people that follow the market.  And many keep the sound turned off but watch the graphics and information. 

CNBC of course is sponsored by the mutual fund industry. So it is in CNBC's best interest to cheer lead the market. it struck me today just how wonderfully the graphic of green for up and red for down does that. 

In the morning as the market opens, the panel of all stocks only have to open up a bit for the entire grid to tun green. And it turns bright green, not just a hushed shade of say yellow to represent say .1%. No siree, it turns green whether stocks are up .1% or 10%!. Admittedly this is true for down days as well. Red is red without regard to the percent drop.  But the exhibit of the leading stocks like Apple in green for go is quite a nice psychological touch to getting all on board. 

But since the year began the higher the market goes, the less the percent gain is. But you would never kow that from the green displays. Geographic maps have varied colors for the rainfall areas receive.

Not CNBC it's bright and green on any up day, welcome to Oz!

Insiders

Corporate insiders are usally on the right side of the trade. Readers know my propensity to believe the casino industry is a bellweather of social mood. And so a sale of 20,000,000 shares of MGM Mirage for $268,000,000 caught my eye today. Mirage is as we have said floating on a sea of junk debt and has doubled down vbetting its future on Macao now that City Centre is shaky.  At least this insider should be okay no matter what hapens to MGM. 

Insider selling continues at a high level. That coupled with a rollover in the summation index, high BPs, and massive speculation in real estate speculation in other countries led us to conclude this was a high risk environment. 

We do regret our hasty exit, seasonally that was clearly an error. We have a comitment downtown tonight and will comment tomorrow morning. 

 

 

Mopping Up LTRO 2.0

Tuesday February 28, 2012

Here is the HD video of the waiter spilling beer on Angela Merkel.

As one astute Market Perspective  reader cleverly observes

It's just a great physical manifestation of the symbolic problem that is created when "excess liquidity gets sloshing around"!

Couldn't have said it better myself!

Fundamentals of Euro Crisis

Tuesday February 28, 2012

An alert reader asks bout LTRO 2.  In fact here is the question.

Professor, isn't the $BPINDU already in nose-bleed territory at over 96?? Please correct me if I am wrong, but it doesn't look like it's been that high since the spring of 2010...everybody knows what happened then - the greek drama roiled the markets for almost 2 years and now nobody cares that the country has been declared to be in selective default. I suppose Keynes was right about one thing: Markets can remain irrational longer than you or I can remain solvent. Do you have any thoughts on LTRO 2?Well first off, LTRO stands for Long Term Refinancing Operation, the European equivalent of the US QE 1 and 2 (the Fed operation not the CUnard line ship). 

This piece form Seeking Alpha (whoops typo, sorry) does a pretty good job of summing up the mechanics and likely outcome.Note the   stockcharts graph showing that once QE 1 and 2 ended here, the markets fell, hard. 

Market Perspective Answer

To answer Julie's question, Europe would be far better off to let Greece default and then live with whatever rate they have to pay on new debt. Why waste all this money in the meantime and burden future generations with the mistakes of today's bankers. In retrospect the big mistake Greenspan made, among others, was bailing out Long Term Capital Management. Here is why

• The bets LTCM made finally were whole anyway
• it sent the Too Big to Fail Message which assured Richard Fuld at Lehman he would be rescued
• And that had everyone making outlandish betso mortgages
• iI LTCM had gone broke their wild trading could and would have been excoriated in the press, others would get the message, risk your money and face the consequences. 

Greece has been in default as often as it has paid since becoming a modern country. It is a country of only 10 Million. No doubt the dealing has been drawn out by bankers in Germany and France lobbying Sarkozy and Merkel, both of who will stand for re-election. But, Italian bonds are doing better while Spain wobbles. 

The current state of Japan speaks to what happens when bad debts stay on the books. Now Japan has not one but two lost decades and is starting on a third. See today's news about Panasonic with too many employees and the last DRAM manufacturer going bust. 

Bailouts

I was at my day job yesterday, college professor, and just caught up with the news today. Buried in Section C of the WSJ I was surprised to learn the ratings agencies declared Greece to be in Technical Default. 

Now in the 'there is nothing new under the sun dept', we remind you of this Oct 30, 1975 headline, Ford reportedly to NYC's request for a bailout..  As with QE 1 and 2 and now the European bailout, Ford then relented and sent over $2 B to the City. The Comptroller for J C Penny came in for a year to help straighten things out. 

Now remember the European bailout is not about bailing out Greece or Spain per se, rather it is about bailing out the French and German banks that own the dilapidated debt. Greece could really care less about he bankers, they want their pensions!

Our take?  Scroll down.

 

 

 

 

 

 

The answer is that social mood does not necessarily line up with the news. The low for social mood was last August 8 and Oct 3-4. The recovery in mood continues as we have noted despite what it rather obvious, Europe is no more likely to solve its problems by showering cash on bad debts than than the USA was goig to fix bad bank oans with a similar arrangement. 

Bullish percent lines up as follows

Dow        96.87

SPX         85.40

NYSE        78.15

COMP        64.39

So the thinner the index and the more those stocks show up in widely held funds, the higher the bullish percent is, no real surprise there. 

It would be extremely rare to have  collapse in February or March ala an October style collapse. A sell off yes is expected. In the bear market of 1973-74, stocks topped in January and then melted for two years. But the market never dropped more than 10% in any month.   That is the sort of action I expect this time. 

This is a progression. The summation index turns down. The bullish percent indexes move at different rates. The Advance Decline line makes a new high. The current Nifty Fifty of the 1970s, that would be IBM and Apple and Google, not to mention ingenue Facebook, are all hyped in the media. 

Social Media Mania

The IPO for Facebook may well mark the final top.  That  would be a perfect socionomic moment. There is am article in the WSJ today wondering why Google does poorly in social media against Facebook.  Gee, Google already a falling star?

CFO, a magazine for accounting types, has an article in the current issue on CFOs and social media.

I attended  a webinar on the importance of snapping tags  While this might have considerable value for taking inventory or pricing retail items, I was unsure how  this improves education. But by golly it must be important!  Our thought - What is important is having students read and understand a process. Only writing and public speaking provoke the constructive thought for this to happen. 

No doubt Facebook counts me among its 850 million users. But I don't use Facebook after starting a page. . Should I be using Tweets, RSI feeds and such, beats me really.  There are a lot of teenagers roaming shopping malls but that does nto translate into their buying anything. This is the reason Buffet bought a railroad and I recommended RIG and GM, those are industries he and I understand, no I am not comparing my self to Buffet, just our shared generational level of analysis. 

The initial craze for personal computers winnowed down to two operating systems. Only Apple that went for profit rather than market share seems to have lived the dream of high tech.

Tablets are where PCs were in 1978, none of them share compatible systems. Who will win?

In software MSFT bought out its rivals and lies moribund with numerous non starts like Zune. The craze for dot.coms finally resulted in nationwide auction sites like E Bay and on line retailing like Amazon, the others are long gone. Kathy Ireland now makes more than Martha Stewart, go figure. 

Murdoch's bet on My Space didn't pay off well. My point is that we are still in the early stages of the latest Pong Craze, which reminds me, how much of a player is Atari these days?

Facebook and Youtube appeal to exactly what Dale Carnegie recommended decades ago.

You will make more friends in two months showing an interest in other people than you will in two years trying to get them interested in you.

  Facebook is a world wide look at me scrapbook. Youtube let's everyone be Director Woody Allen. E mailing photos on cell phones is the long awaited reality of the ATT picture phone!  Yep the McLuhan global village has arrived. 

But does this produce real goods and services? China builds its navy while our kids are at Gamestop; you tell me how that one ends. 

Okay enough of that rant....

We have positive social mood with RL going to new highs, Distinctive Property Listings expanding, and comic books at auction for $300K. At the same time as I mentioned this weekend, Sleigh Bells rings the cash register with negative titles, 35,000 ring Moscow in protest, North Africa is on fire, yep, as Richard Russell might say, there is hard rain coming. 

 

Bottom Line

The markets are transitioning to a final top for this phase, that would be from March 2009 bottom to this top. it is happening in stages to confuse most participants. IF everything happened at once that would be too obvious, Mr. Market is much more clever. Like Kipling's cobra, it sways too and fro attempting to assure  the mongoose there is nothing to fear. 

Well gee nothing gets me going like a good question. 

 

 

 

Looks A Lot Like April, 2011

Tuesday February 28, 2012

The bottom line? From a long-term point of view, stocks are overvalued relative to historical norms. But, from a shorter-term perspective, the good news is that they are not quite as overvalued as they were last April.

Mark Hulbert, Stock Valuations at Market Watch 2/28/12

This is the sort of article that economists like to write. Endless amounts of data now available for high speed computer consumption. This  means that there is more data about whether forward or backward or near term or whatever earnings mean something.   Management  manufactures interim earnings for the three quarters that are not audited, before the annual audit.

What this really tells us is that the public is about as optimistic as they were last April.

In other words, what do you do when the market opens this morning at 8 30 CST?

I suggested a couple of weeks ago we follow the lead of the corporate insiders. That would be the guys and gals that manufacture these earnings estimates; they are selling, big time. 

Since Mark Hulbert is comparing the market to last April, let's do the same with our dashboard.

From top to bottom we have the Dollar, then TLT a fund of long term government bonds and then the VIX, an indicator of complacency. When the stock market participants begin to worry, all three of these rise. So let's compare the mental state of our market with last April.

In the main panel TLT bottomed in early April. It the began its climb from 90 to 122. We were buying at 90. 

The Dollar bottomed a couple of weeks later and then it too began climbing. 

At bottom the VIX hit its low in late April and then leisurely rose through the summer, rocketing up in August.

Now, the big question, how does the position of al three today compare with the position then?

I'd say about the same. I put the dollar behind TLT but it was too confusing. So I left it in the top panel. It continues to make higher lows and just bounced off the lower band.

TLT has bounced three times and moved over the MA yesterday. 

VIX reveals a very high level of complacency when it is under 20. 

Here is a shorter term view of the same chart. The more likely direction for all three indicators is up, which means stocks are likely to move down.

 Note that al three have tested the lower band and now are quietly moving up. 

Let's look at the Dollar and see if it is quietly signalling some change.

US Dollar

I split the difference of the 50 and 200 day MAs and inserted a 125. Bingo, the Dollar just hit that level and bounced yesterday. The blue circles on MACD and the blue arrows on price suggest that this is a support level. The Dollar should mount a move up from here along with VIX and TLT.

At top gold has not nearly the performer you would think by listening to cable tv, unless you entered carefully. We did at the end of December and made some money. Note gold has risen to previous resistance at 1800. 

We have a succession of orders at lower levels to buy modest amounts of TVIX and HDGE. THese are funds that advance as the stock market falls. These are short term plays. 

Be patient, all the blather  about Dow 13,000 is meaningless. The fact that insiders are selling and these important indicators above have all bounced at support levels, however, is quite important. 

so put what we have posted this past week together

 

The Summation Index peaked a couple of weeks ago and rolled over

Insiders are selling much more than buying.

The Bullish Percent are at 84-89, over 90 is top timing territory.

The three indicators here have pulled back, tested support, and appear ready to head up as they did last April So this confirms what Hulbert is saying about valuations, for the fundamental crowd. 

Stay focused, be patient....bettter buys lie ahead. 

 

 

Warning Signals Page C1

Monday Feb 27, 2012

Today's WSJ seems to be confirming our suspicions of a nearing market top, consider Page C 1

Retail investors have plowed $11.9B into junk bond mutual funds this year - that would be in the past two months

Junk

the CMF at bototm shows that ivestors bought what was performing  wel at the time in late December-Junk Bonds. Here at TMP we recommended what was not performing well, gold and silver, which bottomed at that time, you know, that buy low idea.

But continuing down Page C1

Another 59 acre development in China is only half complete, hmm I wonder who has the note on that one?

And at bottom, the Citigroup US Economic Surprise Index closed at 58 Friday, down 34 points since early January.

Again these indicators are confirming  the downturn in our Summation Index which moves ahead of the lagging price indexes.

The clues are al here but amateur investors are missing most of them.

$3 Gasoline

Monday Feb 27, 2012

I have suggested that oil is probably more near a top than just beginning a new bull market.

Here is a broadcast suggesting $3 is more likely than $5 gasoline .

Jeremy Gratham

Monday Feb 27, 2012

Here is an interesting article from Market Watch. Author Burton (why did a nice clean shave go out of fashion I wonder) lists Grantham's ten suggestions. And when you list ten things surely some of them are worthwhile.

Now for those of you that are not used to reading rambling tomes from big brokerage firms, click on the longest quarterly letter ever from Grantham.

He does call for more scientists rather than lawyer politicians and notes that is the case for China. Beyond that, this reads like al the stuff E F Hutton, Bear Stearns, Bache, et al used to put out in their day. Read it all and well you tell me, what do hyou know, and what does it say to do this morning?

That's why I started this blog. We have a couple of positions in SJT and HGT, we are accumulating some shorts. We may have started too late to establish many  positions with lower orders. We sold a couple of weeks back with profits in several sectors.And frankly some did not work out nearly as well, that's the point of diversification as he says.

Grantham on the other hand reflects the classic brokerage firm thinking of always being long the market.That's great if you bought Apple in 2000, not so great if you bet on Dell.

We will continue to be on point and avoid this sort of long rambling discourse. But then Grantham runs a lot more money than TMP so there is apparently still a big market for this kind of thinking.

Stocks and gold are modestly off in early trading this morning.

 

Pendulum Wave Patterns

Monday Feb 27, 2012

Here is an interesting demonstration of how a wave pattern begins, exhausts and then begins again.

Readers are aware we study patterns in market behavior looking for clues. Last eyar stock peaked in early summer, declined into the fall and and are now back near or at July highs. Patterns repeat.Take a look at this short video, interesting eh?

Pendulum waves

Now that Everyone is Long Stocks....

Saturday Feb 25, 2012

 Overview

Stocks appear to  need a correction thought the Euro is moving up which is supportive to stocks. today we note the different messages among the NYSE price idex versus the internal oscillators and bullish chart patterns. The summation index tipped its hand first, price is still headed up on the weekly chart due to market cap weighting.  The best estimate would be for a pullback in stocks and then one more run up into the traditional seasonal tax day finale.  

We addressed Energy yesterday and it too is headed higher. See our Friday post.

Social mood is positive via demand for luxury goods But the seeds of negative mood are here now. We examine the evidence. 

 

Weekly New York Stock Exchange

We don't exist on a desert island and we do read other websites and blogs.Art Hill at stockcharts.com makes this point about the weekly NYSE chart-it does not show signs of topping! Sure it does not.

His point was that the MACD at bottom has to turn down before we have confirmation of a top. One can see that the topping process in 2011 took several months. But wait, this was a broadening  top in a price weighted index.

Just to be sure I looked up the calculation of the NYSE index and the NYSE site tells us that...

The NYSE Composite Index consists of more than 1,900 U.S. and non-U.S. stocks. The Index utilizes a transparent, rule based methodology, which includes free-float market cap weighting. The Index is calculated on both a price return and total return basis.

So the larger the market capitalization the more weight that security receives in calculating the index. Okay get another cup of coffee, I am going somewhere with this. Readers Will recall that last weekend we showed that both the weekly and daily summation indexes had broken over. True but, the weekly  price index based on market cap is still rising. 

Daily NYSE

It looks like a third wave on the daily NYSE is coming to an end. The daily MACD at bottom has crossed over to the downside. That would suggest that a fourth corrective wave should begin shortly. Oh I am using the NYSE to stay constant, as the summation index uses the NYSE. 

So, the weekly chart is still headed up. that makes sense if a daily third wave in price is ending now.

But remember the summation index is not market cap weighted, which is why it appeals to us as a broader view of what is happening.

Did you get that fresh cup of coffee?  Okay, at top we have the McClellan Oscillator, the net advances minus declines. It turned down in early February. The summation index in the large chart is the result of cumulative total of the oscillator in the top panel. So it lags, note it topped a week later and has not turned down. The MACD at bottom confirms this downturn. 

So, summing up

the weekly price of the NYSE index is still headed up.

the daily price of the NYSE index appears ripe for correction. I am guessing this is  a fourth wave coming up, as we say there are other sites that specialize in counting Elliott Waves this is not one of them!

the daily summation index suggests this correction among the larger group of total stocks traded has already begun. One just does not see it quite yet in the market cap price index of the NYSE itself. 

Hmm, is this helping or are you thinking of moving from coffee to something more, ah, soothing....

 Rather than list a dozen different charts, here is a screen shot of part of my stock indicators group. Run your eye down the list and you can see the climax building. But that climax on the first weekly chart shown today  may lie a few months out. These levels can remain elevated for some time. 

Of the 500 S & P stocks 415-443 are already over MAs, so not a lot left there.

The weekly Advance Decline line turned down a bit.

Bullish percents are 83-88.6%. Tops occur over 90 as we showed last weekend.

Finally the smaller the number of components of these indexes, the further they are along. With only 30 stocks the DOW is at 96.67%, the others at lesser levels. 

Bonds

 TLT a fund of long term government bonds has formed a downtrend channel. We will not likely hit the final high in stocks until TLT approached its 200 day MA now at 108+. But money is flowing out of bonds to stocks. A this rate of drop that could take another three to four months. That would put us into May or June which is about the seasonal time for a decline. 

Note that the 50 day MA was supporting price, now it acts as resistance. A reader asks about increased Money Flow; that apparently boosted TLT back to the upper downtrend line. But now that I think about it, coupled with the rise in TVIX below, a move to more money in TLT makes sense. That would seem to further confirm our suspicions of a top in the NYSE very shortly. 

TVIX

I mentioned I had a succession of orders at lower prices for TVIX, not a big position, just purring my toe in the frothy water. Yesterday's order placement paid off with an order right near the low of the day. 

I placed GTC orders at 16.77, 15.77, and 14.77. The first was just a bit lower than the previous Day's trade when I began. Given the big swings in TVIX it seems a dollar apart would be about right. The low yesterday was 15.62, and that only lasted a few minutes, take a look at this 30 minute bar chart. My point is that the chance I would have gotten this even if I had been looking at the chart all day long is low to non existent. By having the order in ahead of time, well, one alert TMP reader actually phoned to point out I had snagged TVIX near the low of the day.In  this case the orders caused us to be at the right time at the right price. 

Broker training consists of lots of tricky questions in multiple choice format to make passing the exams difficult. And, your broker is really not interested so he or she is not trained, in your getting the BEST price, rather the object is to put you in something that earns a commission. You and I however are interested in the best price because that results in the greatest percentage gain. And after all , you and I need the money.....

The BIG Picture for TVIX HDGE

Speculation soared on the early bottom in TVIX shown by the volume in the lower panel. 

It appears that TVIX may be used to hedge some exisitng positions.

We have orders in HDGE at 20.33, 20.03,19.77, 19.53. This way we add to the position if the market advances lowering our average price. 

Energy

 

See our somewhat lengthy, for a Friday morning, post yesterday about energy prices. 

Currencies

 The WSJ reports soaring optimism over Greek and Italian debt..The dollar is in green. I read targets of 140 on the Euro and 76 on the Dollar. That may mark the spring high for stocks in the US when it happens.  It has taken about a month for the Euro to shake loose from its 50 day EMA.  Now the 200 needs to be hurdled and it will be. 

New Civil War

Where's the toughest battlefield in American education these days?  ...But for downright nastiness, Southern California is ground zero.

Triggering School REform And Union Dirty Tricks, page A 11 Weekend Journal

We have noted the schism between North and South. The Civil War Map, the Right to Work Map, and the Red Blue States map are all the same map. And so California is a Northern Blue State. This article details lots of dirty tricks to prevent Parent Trigger from ousting  failing teachers from a rural school. Take a read to see where the New Civil War is likely headed.  Union Power is  now concentrated in impossible to fire government workers. The work product therefore is  not subject to supply and demand like say automobiles.  The staying power  then is immense. Read the article to see what we mean. 

Socionomics

Of various art forms, music can react faster than say television or movies. And so we noted Dan Neil's (Rumble Seat column page D11) mention of Sleigh Bells' song Comeback Kid. I had never heard of either but Neil's description is

if after two minutes of listening to Comeback Kid you aren't jumping around the room rocking your air guitar, check your mail It might have deceased stamped on it. 

So I logged onto iTunes and gave a listen, gee, after thirty seconds I was turning the sound down not up, this ain't no Build Me  A Boat by Jimmy Buffet, not by a long shot. This might have me jumping around the room but looking for escape, not enchantment Dan.

Sometimes social mood anticipates the crisis. In 2008, I noted the popularity of The Dark Knight to my classes. One student had already seen it twice. The movie grossed $500 Million. Its tag line-For the City there is no Hope. Later that year stock markets world wide crashed in one of the worst disasters ever. 

Now here is the   listing for this 'light and breezy' album named, Reign of Terror. 

 

Run your eye down the titles, what do you read, what images do the titles bring to mind, what are the images the group is seeking to resonate with listeners?  Well it sure ain't the Sound of Music, eh?  The titles suggest themes of death and destruction, just as The Dark Knight did in 2008. By the way completing the circle Heath Ledger that played The Joker in Dark Knight died of a drug overdose after the movie was released. 

The titles suggest anything but hope and a bright future. For a listen click Reign of Terror which opens, yes, with a gal jumping up and down on a bed with a semi automatic rifle in her hands. I will leave it to the English Majors to interpret all of this but when such lyrics are making mainstream inroads, the socionomic signals are loud and clear, danger ahead. 

I found this review at The Economic Voice for REeign of Terror

On such a terrifically entertaining record, you might expect a song like ‘You Lost Me’ to stand out as a down note – quite the reverse, in fact. And when that happens, you know you are on to a winner. This is a record that deserves to sell by the wheelbarrow load.

I disagree with the reviewer about terrifically entertaining, but if it does sell by the wheelbarrow load we can be sure Reign is in tune with The Mood. 

Cinema

Here is a synposis of the upcoming Hunger Games, again from Economic Voice

Chosen from the rural backwater of the twelfth district, the young combatant will find herself broadcast in a series of televised events, a contest that will witness the teenager not only compete against those chosen from the other districts but engage in a fight for survival in a contest where only one contestant will leave the games alive.

This sounds a lot like The Running Man, where Arnodl was pitted against a group of adversaries in a fight to the death match. Running Man was a 1987 release, just in time for that crash. Director Gary Ross last film was the upbeat Seabiscuit relased in 2003 as the markets recovered from teh post 9/11 crash. 

Read more: Hunger Games

Our friends at Elliott Wave International posted this thought about the Oscars tomorrow night. 

A subscriber to our Financial Forecast Service also sent along a link to a column in Salon by Andrew O'Hehir about this year's Best Picture nominees: "These are the Oscars of wounded dads and autistic kids, of orphans in love with old movies and lonely guys struggling to break free of nostalgia. When you look at this year's nominated films, it's not like there's a tenuous theme that halfway threads them together. There's more like a torrent of male grief, sadness and loss that pretty well drowns you." (Feb. 7, 2012) That description fits in well with how we see social mood playing out now, which does not bode well for the financial markets.  

Yep grief, sadness, and loss, those are the themes both in music and on the screen. The Artist is set amid the Depression about an actor  facing a failed career. Hmm, social mood gravitates to the art that reflects the mood. 

Markets are fast approaching a peak of multi-year proportions. The change in mood is already apparently being forecast. We have prepared you for what to expect. 

Thanks for reading The Market Perspective, we hope our thoughts have improved your investing results.  As always we appreciate constructive comment. 

 

[email protected]

 

 

The Market Perspective bases its information on techniques and sources that have been found to be reliable in the past, and The Market Perspective tries to base opinions on sound judgment and research, however, we do not guarantee that future results will match past performance ands no guarantee can be made that advice will be profitable. The Market Perspective accepts no money for stock recommendations and is purely motivated by its own research in recommending any stocks.  Put another way, the responsibility for decisions made from information contained in this letter lies solely with the individuals making those decisions. The editor and persons affiliated with The Market Perspective may at times have positions in securities mentioned.  Nothing contained herein represents an offer to buy or sell securities. The Market Perspective encourages investors to be diversified, and to maintain sell stops and risk control over their valuable investment capital.  No guarantee can be made to the accuracy of text or charts.